A recent World Economic Forum (WEF) report reveals that 56% of economists anticipate the global economy will either stabilize or improve over the next year. However, they caution that rising living costs, decreased government support, and uncertainty surrounding artificial intelligence (AI) could hinder growth. These factors highlight the complex landscape facing economies as they navigate technological advancements and financial pressures.
The WEF’s Chief Economists’ Outlook, released on Tuesday, stated that economists were still worried about several risks. Despite this, around two-thirds of economists expect global trade to increase. The US is expected to remain the most favourable place for multinational companies. South-East Asia and Europe are next. India is ranked fourth, while China remains fifth. Around one-third of economists expect unemployment to rise in the US, China and Europe. The cost of living is expected to remain a major concern. Most economists expect people’s real incomes to either fall or remain unchanged in most regions.
Around 97% said conflicts between countries could create problems for the global economy over the next year. About 58% also expect asset prices to fall, while only around 25% believe the global economy will become stronger and better able to deal with future shocks. Around 77% of economists expect economic divisions between countries to increase over the next year. About 55% expect tariffs in the US to rise, while 43% expect higher tariffs in Europe. About 83% also expect Chinese exports to countries outside the US to rise. Around 88% of economists expect food prices to rise, while 83% expect electricity prices to increase and 77% expect transport costs to go up.
India and South-East Asia are different. Governments are expected to use measures such as tax cuts on essential goods, subsidies and price controls to deal with higher costs. More than 60% of economists expect real incomes to increase in both regions.
